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(Kona “Bruddahs” are bullish about the pending deal)
On November 11 Anheuser-Busch InBev made an unexpected U-turn after turning down a deal to acquire the rest of Craft Brew Alliance (CBA) in August, and announced the purchase of the whole company in an estimated US$321 million deal…
It was an unexpected move by the world’s largest brewing conglomerate, especially in light of the fact that its original decision to not purchase the family of craft breweries came with a contractual forfeit of $20 Million to the CBA…
And here’s what some beer business analysts are thinking about what will prove to be one of 2019’s biggest beer news events…
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This from Andy Morton, just-drinks Deputy Editor at GlobalData, a leading data and analytics company….
“This is a deal that hardly registers on the scale of recent A-B InBev merger and acquisition (M&A), which includes the US$107bn takeover of SABMiller in 2016 and the pending US$11.3bn divestment of its Australian operations to Asahi Group.
(just-drinks Andy Morton)
“The final price tag, however, shows the virtue of A-B InBev’s patience as it allows the Budweiser brewer to gain full control of CBA for a knock-down price compared to activating an option negotiated three years ago.”
“CBA’s management and its 800 employees will hope that the alliance’s full surrender to its minority partner can recapture growth, and help it shrug of a craft beer lethargy compounded by the incursion of hard seltzer and near-beer’s attraction to young legal-age males.”
There is much for A-B InBev to work with at CBA, not least the Kona brand, which this year sold so well on the back of its Hawaiian island heritage that production couldn’t keep up. Kona’s bright and sunny marketing fits well in the era of hard seltzer brand White Claw, and can go some way to protecting both CBA and A-B InBev from the fast-moving changes shaping the future of the beer category in the US.”
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This from Bryan Roth at the always insightful Good Beer Hunting…
Bryan Roth – Good Beer Hunting
“Three months after Anheuser-Busch InBev declined to move on its exclusive rights to purchase Craft Brew Alliance (CBA) and its roster of breweries, its decision to hold fire literally paid off: the multinational will finally purchase CBA, with one estimate putting the savings around $157 million.”
“By adopting CBA’s roster into its Brewer’s Collective craft portfolio, AB InBev brings its tally of craft breweries to almost 20, and further entrenches geographical advantages in the Pacific Northwest and East Coast.”
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And finally this from Motley Fool’s Joe Tenebruso who explained that the deal’s announcement was certainly good news for Craft Brew Alliance shareholders…
“AB InBev already owns a 31.2% stake in Craft Brew Alliance. It’s seeking to acquire the rest of the company’s stock for $16.50 per share — a premium of 125% to CBA’s closing price on Monday.”
“Shares of Craft Brew Alliance (NASDAQ:BREW) surged by more than 120% on Tuesday, following news that Anheuser-Busch InBev (NYSE:BUD) has agreed to buy its remaining stock at a huge premium.”
